ZTO Express (Cayman) Inc (ZTO) 2024 Q3 法說會逐字稿

Good day and welcome to ZTO Express to announce third quarter 2024 financial results conference call (Operator Instructions) Please note this event is being recorded.

美好的一天，歡迎來到中通快遞宣布 2024 年第三季財務業績電話會議（操作員說明） 請注意此活動正在錄製中。

I would now like to turn the conference over to Sophie Li. Please go ahead.

我現在想把會議交給 Sophie Li。請繼續。

Thank you, operator. Hello, everyone and thank you for joining us today. The company's results and the investor relations presentation were released earlier today and are available on the company's IR website at Ir.zto.com.

謝謝你，接線生。大家好，感謝您今天加入我們。該公司的業績和投資者關係介紹已於今天稍早發布，並可在該公司的投資者關係網站 Ir.zto.com 上查閱。

On the call today, from ZTO are Mr. Meisong Lai, Chairman and Chief Executive Officer; and Mrs. Huiping Yan, Chief Financial Officer. Mr Lai, will give a brief overview of the company's business operations and highlights followed by Mrs. Yan who will go through the financials and guidance.

今天參加電話會議的是中通通訊董事長兼執行長賴梅松先生；以及財務長顏慧萍女士。賴先生將簡要概述公司的業務運作和亮點，隨後嚴女士將介紹財務狀況和指導。

They will both be available to answer your questions during the Q&A session that follows I remind you that this call may contain forward-looking statements made under the Safe Harbor probations of the Private Securities Litigation Reform Act of 1995.

他們都將在隨後的問答環節回答您的問題。

Such statements are based on management's current expectations and current market and operating conditions and relate to events that involve known or unknown risks, uncertainties and other factors. All of which are difficult to predict and many of which are beyond the company's control, which may cause the company's actual results, performance or achievements to differ materially from those in the forward-looking statement.

此類聲明是基於管理層目前的預期以及當前的市場和營運狀況，並與涉及已知或未知風險、不確定性和其他因素的事件相關。所有這些都很難預測，其中許多超出了公司的控制範圍，這可能導致公司的實際結果、績效或成就與前瞻性聲明中的結果有重大差異。

Further information regarding this and other risks uncertainties and factors is included in the company's filings with the US Securities and Exchange commission. The company does not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise except as required under law.

有關此風險以及其他風險不確定性和因素的更多資​​訊包含在該公司向美國證券交易委員會提交的文件中。除法律要求外，本公司不承擔因新資訊、未來事件或其他原因而更新任何前瞻性聲明的義務。

It is now my pleasure to introduce Mr. Meisong Lai. Mr Lai will read through his prepared remarks in their entirety in Chinese before I translate for him in English.

現在我很高興向大家介紹賴梅松先生。賴先生將用中文完整地閱讀他準備好的發言稿，然後我用英文翻譯給他。

(spoken in foreign language)

（用外語說）

Thank you Chairman. Please let me translate first. Hello everyone. Thank you all for joining today's conference call in the third quarter of 2024. ZTO continued to maintain its leading service quality among years our total puzzle value reached 8.72 billion, representing a 15.9% year-over-year growth. Meanwhile, we achieved adjusted net profit of CNY2.39 billion and our profitability remains ahead of our comparable peers.

謝謝主席。請讓我先翻譯一下。大家好。感謝大家參加今天的2024年第三季電話會議。同時，實現調整後淨利23.9億元，獲利能力持續領先同業。

ZTO adheres to high quality development and we set a strategic direction at the beginning of the year to accelerate establishment of differentiation in products and services. While enhancing brand awareness and recognition. In this quarter, ZTO further strengthened the standardization and the streamline across our operational segments.

中通堅持高品質發展，年初就確定了策略方向，加速打造產品和服務差異化。同時提升品牌知名度和認可度。本季度，中通進一步加強各業務板塊的標準化和精簡。

Our end to end timeliness ranked number one among the players and the customer complaint rates continue to decline. We are winning the trust of ecommerce platforms and consumers. Our partnerships with various e-commerce platforms have a deepened particularly in reverse logistics services and the remote area express delivery services.

我們的端到端時效性在業界排名第一，客戶投訴率持續下降。我們正在贏得電子商務平台和消費者的信任。我們與各電商平台的合作關係不斷深化，特別是在逆向物流服務和偏遠地區快遞服務方面。

As a result, our retail puzzles grew over 40% year-over-year. The optimization of our revenue structure has effectively alleviated pressure due to price competition combined with strong and sustained cost efficiency and a stable SG&A expense structure. We further widen our lead in proposal operating profits.

結果，我們的零售難題年增了 40% 以上。我們收入結構的最佳化有效緩解了價格競爭帶來的壓力，加上強勁且持續的成本效率和穩定的銷售、管理及行政費用結構。我們進一步擴大了在提案營業利潤方面的領先優勢。

China's Express delivery industry experienced a 20.1% year-over-year increase in the third quarter. There is an expanding proportion of low price e-commerce parcels and the price sensitivity fueled by weak economy contributed to the recent trend of mix shift.

第三季中國快遞業年增20.1%。低價電商包裹佔比不斷上升，加上經濟疲軟帶來的價格敏感度，促成了近期的混動趨勢。

We believe that higher quality focus the growth of the Express delivery industry depends largely on the certainty and the sustainability of the microeconomic recovery and growth.

我們認為，快遞產業成長的品質聚焦很大程度上取決於微觀經濟復甦成長的確定性和可持續性。

The current new economic dynamics presented the challenging question of how to balance across our core values that is quality of services, scale operating profit and interest of franchisee partners maintaining and expanding our scale leadership advantage is one of the precursors for achieving growth with both quantity and quality in keeping with the ZTO's practical culture of finding and resolving issues.

當前新的經濟動態提出了一個具有挑戰性的問題，即如何平衡我們的核心價值觀，即服務品質、規模營業利潤和加盟商合作夥伴的利益，保持和擴大我們的規模領先優勢是實現數量和規模成長的先決條件之一。

We reviewed our work for the past few quarters and identified needed improvements particularly in division of duties and the coordination between headquarters and the provincial management alignment of market conditions and the pricing flexibility, effectiveness of incentives and fairness and the transparencies in network policies. Key improvement tasks will focus on the following.

我們回顧了過去幾個季度的工作，指出了需要改進的地方，特別是總部和省級管理層之間的職責分工和協調、市場條件的一致性、定價的靈活性、激勵的有效性和網絡政策的公平性和透明度。重點改進工作將集中在以下幾個方面。

First, reviewing pricing policies thoroughly. We ask provincial management to be more responsive and stay relevant to market conditions and we shall provide them with greater autonomy making comprehensive assessment of customer needs in high production regions to better align pricing with service requirements, co-ordinating sales and the cost differential differentials with customized strategies to share resource burden and profit allocation among the pickup partners, delivery partners and brand operator.

一是深入梳理價格政策。我們要求省級管理層更加積極響應並緊扣市場狀況，給予他們更大的自主權，全面評估高產量地區的客戶需求，更好地將定價與服務要求結合起來，協調銷售和成本差異定制策略，在取貨合作夥伴、配送合作夥伴和品牌經營者之間分擔資源負擔和利潤分配。

Second, eliminating complex policy to drive simplicity, standardization, fairness and transparency. Meanwhile, be ready to provide unique incentives coupled with targeted expectations, providing certainties and confidence to network partners who will then become more enrolled and ready to respond whenever there is a power for collaboration.

其次，消除複雜的政策，推動簡化、標準化、公平性和透明度。同時，準備好提供獨特的激勵措施和有針對性的期望，為網路合作夥伴提供確定性和信心，然後他們將更加積極參與並準備好在有合作能力時做出反應。

Third, optimizing the effectiveness of a coordination mechanism organized by locals to take pause and foster accurate communications and synchronized actions. Their key objectives are to promote end to end initiatives aimed at enhancing career willingness to serve retail puzzles to promote infrastructure, allowing direct linkage from outlet to last mile posts. These objectives will aid the gradual reduction of delivery costs, increased retail volume and boost income for network partners and careers.

第三是優化地方組織的停頓協調機制有效性，促進精準溝通、同步行動。他們的主要目標是促進端到端舉措，旨在提高職業意願，解決零售難題，促進基礎設施建設，實現從門市到最後一英里郵政的直接聯繫。這些目標將有助於逐步降低配送成本、增加零售量並增加網路合作夥伴和職業的收入。

Fourth, accelerating the deployment of last mile IT systems and strengthening the commercial content by 2C life plus to address diverse needs of local living, it goes beyond decreasing last mile delivery cost to deepen and expand connections with consumers and customers and ultimately benefiting the core business.

第四，加速最後一公里IT系統的部署，透過2C生活+強化商業內容，滿足當地多樣化的生活需求，不僅是降低最後一公里的配送成本，更是加深和拓展與消費者和顧客的聯繫，最終惠及核心業務。

Fifth, leveraging fintech tools such as direct settlement to incentivize last-mile responsiveness and on demand service capabilities, thereby improving the economic efficiency of pickup and delivery operations.

五是利用直接結算等金融科技工具，激勵最後一公里應變能力和按需服務能力，提高取貨和配送業務的經濟效益。

Last but not the least. While driving continuous cost production gain systematically focus on the pace of capital investment and the capacity reserve to maximize resource utilization in a more scientific way.

最後但並非最不重要的。在推動持續成本生產收益的同時，系統性地關注資金投入節奏和產能儲備，以更科學的方式實現資源利用最大化。

China's economic growth has underscored the persistent demand for logistics services over its more than 30 years of development as the industry continues to evolve with increasing value concentration yet quality bifurcation, we inevitably will face varying competitive pressures especially amidst turning points of economic circle cycles.

中國30多年的經濟成長凸顯了對物流服務的持續需求，產業不斷發展，價值集中度不斷提高，但品質分化，特別是在經濟週期的轉折點，我們不可避免地會面臨不同的競爭壓力。

Since details, funding each new set of challenges we face has given way to transformation and the progress. As an industry leader ZTO services, stability wise and depth of network coverage and penetration, cash generation and the financial strength, ability to renew and upgrade our managerial skills. Among other core strengths, all our competitive advantages.

從細節來看，為我們面臨的每一組新挑戰提供資金已經讓位給轉型和進步。作為中通服務的行業領導者，網路覆蓋和滲透的穩定性和深度、現金生成和財務實力、更新和提升我們管理技能的能力。除其他核心優勢外，還有我們所有的競爭優勢。

For ourselves, we intend to maintain our leader sharing service quality, to widen our leading scale and to achieve sound profitability for our partners. We are committed to enlarging the footprint and the solidified economic foundation of the of the last-mile post network, increasing earnings by our franchisees and careers. These are the essential objectives and tasks for the fulfillment of ZTO's longterm growth and the corporate mission. So as to create value for our shareholders and society.

對於我們自己來說，我們希望保持領先的共享服務質量，擴大我們的領先規模，並為我們的合作夥伴實現良好的獲利能力。我們致力於擴大最後一哩郵政網路的覆蓋範圍並鞏固經濟基礎，增加我們的加盟商和職業的收入。這是中通實現長期發展和企業使命的基本目標和任務。從而為我們的股東和社會創造價值。

Next, let's welcome our CFO Ms. Yan to present the financial results and future plans.

接下來請我們的CFO顏女士介紹一下財務表現和未來計劃。

Thank you, Chairman and Sophie. Hello to everyone on the call. As I go through our financials, please note that unless specifically mentioned, all numbers quoted are in RMB, and percentage changes refer to year-over-year comparisons. Detailed information on our financial performances, unit economics and cash flow are posted on our website, and I will just go through some of the highlights here.

謝謝主席和蘇菲。大家好。當我查看我們的財務數據時，請注意，除非特別提及，否則所有引用的數字均以人民幣為單位，百分比變化指的是同比比較。關於我們的財務表現、單位經濟效益和現金流的詳細資訊都發佈在我們的網站上，我將在這裡簡單介紹一些重點內容。

In the third quarter, we adhered to the principle of profitable growth and achieved a 15.9% growth in parcel volume to reach 8.7 billion while continuing to improve the quality of services and brand value. Our adjusted net income increased 2% to CNY2.4 billion. ASP for the core express delivery business increased 1.8% or CNY0.03 as the impact of decline in the average weight per parcel and increase in incremental volume incentives were offset by the positive impact of the volume increases in retail parcels.

第三季度，我們堅持獲利成長原則，在持續提升服務品質和品牌價值的同時，實現包裹量成長15.9%，達到87億件。調整後淨利成長 2%，達到 24 億元。核心快遞業務的平均售價增長 1.8%，即 0.03 元人民幣，原因是零售包裹數量增長的積極影響抵消了每件包裹平均重量下降和增量激勵措施增加的影響。

Our total revenue increased 17.6% to CNY10.7 billion. Total cost of revenue was CNY7.3 billion, which increased 15.2%. Overall, unit cost for the core express delivery business remained flat at CNY0.82. Specifically, unit cost of line-haul transportation decreased 9.7% to CNY0.39, driven by better economies of scale, improvements in fleet operation with better resource utilization. Unit sorting costs decreased 6.4% to CNY0.25, mainly attributable to improved standardization in operating procedures and increased automation.

我們的總收入成長 17.6%，達到 107 億元。總收入成本為73億元，成長15.2%。整體而言，核心快遞業務的單位成本持平於0.82元。具體而言，由於規模經濟改善、車隊營運改善、資源利用率提高，幹線運輸的單位成本下降9.7%至0.39元。單位分類成本下降 6.4% 至 0.25 元，主要歸因於營運流程標準化程度的提高和自動化程度的提高。

Key KA costs increased CNY0.06, which is in line with KA revenue increases. Gross profit increased 23.2% to CNY3.3 billion, and gross profit margin rate increased 1.4 points to 31.2%. Income from operations increased 17.3% to CNY2.8 billion, and associated margin remained relatively stable at 26.6%.

關鍵 KA 成本增加了 0.06 元人民幣，與 KA 收入成長一致。毛利成長23.2%至33億元人民幣，毛利率成長1.4個百分點至31.2%。營運收入成長 17.3%，達到 28 億元人民幣，相關利潤率維持相對穩定，為 26.6%。

SG&A expenses, excluding SBC as a percentage of revenue, increased 0.2 points to 5%. Corporate cost efficiencies remained intact. Income tax expenses were CNY555 million compared to CNY271 million in the same period last year.

SG&A 費用（不包括 SBC）佔收入的百分比增加了 0.2 個百分點，達到 5%。企業成本效率維持不變。所得稅費用為5.55億元人民幣，去年同期為2.71億元。

Let me remind you that in the third quarter of 2023, Shanghai Zhongtongji Network Technology Co., Ltd., a wholly owned subsidiary of the company, received an income tax refund of RMB207.1 million for being a Key Software Enterprise for the whole tax year of 2022.

提醒您一下，2023年第三季度，公司全資子公司上海中通基網路科技有限公司作為全稅重點軟體企業，收到所得稅返還2.071億元。

Operating cash flow was CNY3.1 billion for the quarter, an increase of 5.9%. Adjusted EBITDA was CNY3.7 billion, an increase of 8.7%. Capital expenditure totaled CNY1.8 billion, and we anticipate the annual expenditure of CapEx to come in at around CNY6 billion. We are on track to achieve another year of free cash flow.

本季營運現金流為 31 億元人民幣，成長 5.9%。調整後 EBITDA 為 37 億元人民幣，成長 8.7%。資本支出總計18億元人民幣，我們預期每年資本支出約60億元。我們有望實現另一年的自由現金流。

Now let's turn to our guidance. Based on current market and operating conditions, the company revises its previously stated annual guidance.

現在讓我們轉向我們的指引。根據當前市場和經營狀況，公司修訂了先前公佈的年度指引。

Parcel volume for 2024 is expected to be in the range of 333 billion to 339 billion, representing 11.6% to 12.3% increase year-over-year. These estimates represent management's current and preliminary view, which are subject to change.

預計2024年包裹量將在3,330億件至3,390億件之間，年增11.6%至12.3%。這些估計代表了管理層當前和初步的觀點，可能會發生變化。

We have guided down our annual volume targets based on our visibility into the rest of the year. The increasing proportion of low-value e-commerce package, which may persist for a while, presented new challenges to our approach to our overall corporate strategy. We are recalibrating focuses among quality of services, volume, market share and profit.

我們根據對今年剩餘時間的了解，降低了年度銷售目標。低價值電商套餐的比例不斷增加，並且可能會持續一段時間，這對我們的整體企業策略提出了新的挑戰。我們正在重新調整服務品質、數量、市場份額和利潤的重點。

Particularly, modifications are being made to our pricing practices, for example, with the intention of stimulating high-volume daily average customers to work with our brand. These are with the strong intention of regaining volume growth momentum and expand our existing market share leadership. The quality of our earnings are expected to remain intact.

特別是，我們正在對定價實踐進行修改，例如，目的是刺激每日大量客戶與我們的品牌合作。這些都是為了重獲銷量成長動能並擴大我們現有的市佔率領先地位。我們的獲利品質預計將保持不變。

This concludes our prepared remarks. Operator, please open the line for questions. Thank you.

我們準備好的演講到此結束。接線員，請開通提問線。謝謝。

(Operator Instructions)

（操作員說明）

Qianlei Fan from Morgan Stanley.

來自摩根士丹利的範錢磊。

Thank you.

謝謝。

Operator.

操作員。

(spoken in foreign language)

（用外語說）

Let me translate for myself. So thank you for taking my question. I have two questions. Let me translate for myself. I have two questions. The first question is about the capacity plan for the next year. We continue to see a relatively low-quality volume growth to go to continue into next year, specifically similar to what we have seen in the second half of this year, what will be our, like, CapEx or capacity growth plan for next year? Will it continue to be like mid-teens growth? Or we will likely slow down the volume -- the capacity growth expectation and focus on the relatively high end of the market?

讓我自己翻譯一下。謝謝你回答我的問題。我有兩個問題。讓我自己翻譯一下。我有兩個問題。第一個問題是關於明年的產能計畫。我們繼續看到相對低品質的銷售成長將持續到明年，特別類似於我們今年下半年看到的情況，我們明年的資本支出或產能成長計畫是什麼？它會繼續像青少年中期那樣成長嗎？或者我們可能會放慢產量——產能成長預期並專注於相對高端的市場？

The second question is about our share buybacks. Do we have any further updates or like clearer plan on the execution of our share repurchase plan? Is it still reasonable to assume that we are able to complete or the announced share buybacks by the end -- by the mid of next year when the plans -- the end of the execution plan mentioned last time?

第二個問題是關於我們的股票回購。關於股票回購計畫的執行，我們是否有任何進一步的更新或更清晰的計畫？假設我們能夠在年底前完成或宣布的股票回購是否仍然合理？

(spoken in foreign language)

（用外語說）

Thank you Chairman. And I will translate for the first question and then I'll answer the second question. The overall plan for 2025 is that we will still be focusing on the corporate strategy of balancing approach a balanced approach to all three Quality of services; volume market share; and also our profit. The priority is shifting.

謝謝主席。我先翻譯第一個問題，然後再回答第二個問題。 2025年的總體計畫是，我們仍將重點放在平衡所有三個服務品質的企業策略；銷售市場佔有率；還有我們的利潤。優先事項正在轉移。

And also, we are focusing on regaining the volume growth momentum, and it's based on a reasonable level of profit as we continuously improve the quality of services.

此外，我們也專注於重拾銷售成長勢頭，這是基於合理的利潤水平，不斷提高服務品質。

There are many specific tasks at hand. So again, the goal is to expand our market share leadership, maintaining reasonable level of profit as we improve consistently improve our quality of services. The goal is for our policy to be more relevant and designed around the customer needs and to the market. It needs to be also maintaining its transparency and fairness.

手頭上有許多具體任務。因此，我們的目標是擴大我們的市場份額領先地位，在不斷提高服務品質的同時保持合理的利潤水平。我們的目標是讓我們的政策更加貼近客戶需求並圍繞客戶需求和市場進行設計。它還需要保持透明度和公平性。

The policies are going to be simplified as opposed to too complex, and so that it's easier to be understood and addressed very different needs of our customers. The flexibility would also be allowed given the autonomous decision-making ability that we will provide to our regional managers. The overall intention of this initiative is to improve the trust and confidence of our network partners.

這些政策將被簡化，而不是過於複雜，以便更容易理解和滿足客戶的不同需求。鑑於我們將為區域經理提供自主決策能力，因此也將允許靈活性。此措施的總體目的是提高我們網路合作夥伴的信任和信心。

The second point is to continue to improve the design of our last-mile operation. We've talked about the policy of incentivizing our network couriers to respond more towards the retail parcels. The machinery that are being installed at our post would allow us to improve the proportion of our packages that goes directly from our outlet to the post, alleviating work pressure of our couriers, and hence, helping them work towards improvement of the retail package as a proportion of their total delivery volume, ultimately improve their earnings.

第二點是要繼續完善最後一公里營運的設計。我們已經討論了激勵我們的網路快遞員對零售包裹做出更多反應的政策。在我們的郵局安裝的機器將使我們能夠提高包裹從我們的網點直接到達郵局的比例，減輕我們快遞員的工作壓力，從而幫助他們努力改善零售包裝佔總交付量的比例，最終提高他們的收入。

Third is, again, continuously reaching our goal of tri-layer throughput design, reduce the number of sortation overall for all those outlets that met the requirements in terms of volume to go direct between the origination and the destination outlets or sortation centers will be encouraged to do so. This not only will help us reduce the cost but also improve timeliness of our overall operations. Specifically, for next year, regarding our capacity, the current situation of our total installed base is that it's more than capable of supporting 150 million packages a day.

三是再次不斷實現三層吞吐量設計目標，對符合貨量要求的網點，鼓勵從始至終網點或分揀中心直達，減少分揀數量。這不僅可以幫助我們降低成本，還可以提高我們整體營運的及時性。具體來說，就我們明年的產能而言，目前我們總裝機量的情況是每天能夠支援1.5億個包裹是綽綽有餘的。

Many of our centers today are not at its full capacity running not running at its full capacity. So as we focus on our corporate strategy, improving the retail proportion of our total volume and increasing our market share, these centers with excess capacity would be ready to serve. Now going to the second question as far as the buyback program, the overall goal is for us to complete our plan in buyback as it being the first choice of returning value to our shareholders.

今天，我們的許多中心並未滿載運作。因此，當我們專注於我們的企業策略，提高零售量占我們總量的比例並增加我們的市場份額時，這些產能過剩的中心就可以做好服務的準備。現在來說第二個問題，關於回購計劃，我們的總體目標是完成回購計劃，因為這是股東回報價值的首選。

And the systematic approach will be put in place. And if any excess, we will be giving back to our shareholders in the form of dividend. The buyback rhythm will be in accordance with the market development. And we shall accelerate or increase the frequency of such buyback. That answers your question.

系統化的方法也將落實到位。如果有多餘的部分，我們將以股利的形式回饋股東。回購節奏將根據市場發展而定。我們將加快或增加此類回購的頻率。這回答了你的問題。

Ronald Keung, Goldman Sachs.

姜羅納德，高盛。

(spoken in foreign language)

（用外語說）

Thank you management. I have a first question is on, we've seen a stable profit per parcel in the third quarter, while volumes came slightly below industry growth. So given the full year guidance, does that imply 4Q parcel volumes will be slower? Is that a view on the industry? Or are we focusing more on profitability than market share in this 4Q peak season?

謝謝管理。我的第一個問題是，第三季我們看到每個包裹的利潤穩定，而銷售量略低於產業成長。那麼，考慮到全年指引，這是否意味著第四季的包裹量將會放緩？這是對業界的看法嗎？還是在第四季旺季我們更關注獲利能力而不是市場佔有率？

Second is on our reverse logistics strategy with e-commerce return parcels. What's our strategy there? The typical collection is a lot more frequent for these reverse logistics. So how are we adjusting our network for that and our strategy in gaining share in reverse logistics?

其次是我們的電子商務退貨包裹逆向物流策略。我們在那裡的策略是什麼？對於這些逆向物流來說，典型的收集要頻繁得多。那麼，我們如何為此調整我們的網路以及我們在逆向物流中獲得份額的策略呢？

(spoken in foreign language)

（用外語說）

For the first question. First of all, thank you very much for your question. The guidance is based on our overall approach to balance between all three corporate strategies. And the increase in low volume or low-priced volume in the quarter persisted. So in the fourth quarter, we maintained our prior practice in policymaking. We didn't make drastic changes.

對於第一個問題。首先，非常感謝您的提問。該指南基於我們平衡所有三種公司策略的整體方法。且本季低量或低價量的成長持續存在。所以第四季我們還是維持了先前的政策制定的做法。我們沒有做出重大改變。

Particularly for those large customer or large clients that might have concentrated our volume, we didn't make special incentive policies for them because we are trying to continue to maintain a level of balance across our network.

特別是對於那些大客戶或可能集中了我們業務量的大客戶，我們沒有為他們制定特殊的激勵政策，因為我們正在努力繼續保持整個網路的平衡水平。

There are price increases either from the government's suggestions in area, or individually, there are price movements directed by different market players. Again, the large changes weren't present for this fourth quarter. We were mainly focusing on working in our internal management understanding of how we would approach next year.

價格上漲要不是政府建議的區域價格上漲，就是個別市場參與者主導的價格變動。同樣，第四季並未出現重大變化。我們主要專注於內部管理層對我們明年將如何應對的理解。

As I mentioned earlier, the work is cut out for us to balance across sorting center outlets as well as our couriers. So we wanted to make a better planning in order to achieve volume increases as well as achieving reasonable level of profit.

正如我之前提到的，我們需要平衡分類中心網點和快遞員的工作。因此，我們希望做出更好的規劃，以實現銷售成長並實現合理的利潤水平。

So for the fourth quarter parcel volume, it's not necessarily slower in the market, but it is the fact that we have maintained our prior approach to pricing, but being ready and preparing for the next year.

因此，對於第四季度的包裹量來說，市場不一定會放緩，但事實是我們維持了先前的定價方式，但為明年做好了準備。

Your second question as far as how we are able to address the increased perhaps frequency of customer needs in order to improve the retail volume if I understand you correctly. So the thinking behind what we are trying to do to increase the retail volume is very much so driven by our intention to improve the courier as well as the outlets profitability.

你的第二個問題是，如果我理解正確的話，我們如何能夠滿足客戶需求頻率的增加，以提高零售量。因此，我們努力增加零售量背後的想法很大程度上是由我們提高快遞和網點盈利能力的意圖所驅動的。

The specific tasks we have identified in all three areas, including helping the outlets to improve their ability to have direct linkage between outlets to the post so that they are able to send the packages directly to the post, on average, reducing the cost about CNY0.20 to CNY0.30.

我們在這三個方面都明確了具體的任務，包括幫助網點提高網點與郵局的直連能力，使包裹能夠直接送到郵局，平均降低成本0元左右。

And that also helps our courier to have more time because of the automation that are being placed -- put in place at the outlets so the couriers won't need to go and spend time to help sortation. They are able to spend more time focusing on their area of services, which, on many occasions, has a very small radius so that they could be more responsive to go to serve door to door.

這也有助於我們的快遞員有更多的時間，因為正在網點安裝自動化，這樣快遞員就不需要花時間幫忙分類。他們能夠花更多的時間專注於他們的服務領域，而在許多情況下，服務範圍的半徑非常小，因此他們可以更快地挨家挨戶提供服務。

We believe if we focus on the last-mile post as being the center of the radius of services and allow the courier to work more concentrated their effort to work with their delivery tasks, they are able to improve the percentage of retail price, retail volume, hence, improve their profitability.

我們認為，如果把最後一公里郵政作為服務半徑的中心，讓快遞員更加集中精力去完成配送任務，就能提高零售價格、零售量的佔比。

So with our plan to, one, improve the network partners or the outlet's profitability because they are able to reduce the cost of last-mile operation and improve timeliness and quality of services so they are able to make more money.

因此，我們的計劃是，第一，提高網路合作夥伴或門市的盈利能力，因為他們能夠降低最後一英里的營運成本，提高服務的及時性和質量，從而能夠賺更多的錢。

And at the same time, for our network couriers to have stable and improving profit because of increasing retail volume proportion with both, then our total network will be more stable because it's more profitable. And that is our intention in the specific tasks that we are consistently carrying out. The initiatives are producing great results as we see a greater portion of our retail volume are coming into the total business. Ronald, I hope that answers your question.

同時，對於我們的網路快遞公司來說，因為兩者的零售量比例都在增加，所以我們的網路快遞公司的利潤會穩定並且不斷提高，那麼我們的整個網路就會更加穩定，因為它的利潤更高。這就是我們一貫執行的具體任務的初衷。這些舉措正在產生巨大的成果，因為我們看到我們的零售量的更大一部分進入了整個業務。羅納德，我希望這能回答你的問題。

Lou Jang, Haitong Securities.

盧江，海通證券。

(spoken in foreign language) The first one is since Taobao started cooperating with JDL, what impacts this might have on ZTO?

（外語）第一個是淘寶與JDL合作以來，這對中通可能產生什麼影響？

The second question is about the outlook for the other operating income items in the next quarter.

第二個問題是關於下一季其他營業收入項目的前景。

(spoken in foreign language)

（用外語說）

So let me translate for the first question and I'll answer the second one.

那麼讓我翻譯第一個問題，然後我來回答第二個問題。

The mutual opening of ecommerce and logistic platforms marks a healthy shift towards a more open and collaborative market environment. Platforms will also choose more cost-effective logistics services based on the principle of fair market competition, which helps reduce operational costs and improve efficiency.

電商與物流平台的相互開放，標誌著市場環境轉向更開放、協作的良性。平台也會基於市場公平競爭的原則，選擇性價比更高的物流服務，有助於降低營運成本、提高效率。

This is not only provides merchants with more diverse logistic options, but also offers consumers better delivery service experiences. So we think that this doesn't have a significant impact on our business because we are indeed ourselves an open platform that addresses all service needs from different e-commerce platforms.

這不僅為商家提供了更多樣化的物流選擇，也為消費者提供了更好的配送服務體驗。所以我們認為這不會對我們的業務產生重大影響，因為我們本身確實是一個開放平台，可以滿足不同電子商務平台的所有服務需求。

And now the second question relating to the other operating income. Largely, there is a change because the super VAT deduction is the policy has expired.

現在第二個問題與其他營業收入有關。很大程度上，出現變化是因為增值稅超額抵扣政策已經過期。

And also, for that part of the operating income line, there are less certainty as it relates to for the items that are related to external policies, we are not able to make control. So what we have expected, the fluctuation, excluding those new items, will be minimal. And going into the next quarters and next year, it will still be stable. Does that answer your question?

而且，對於營業收入線的這一部分，由於它與外部政策相關的項目的確定性較小，我們無法進行控制。因此，正如我們所預期的，排除這些新項目，波動將是最小的。進入接下來的幾個季度和明年，它仍然會保持穩定。這能回答你的問題嗎？

(spoken in foreign language)

（用外語說）

[San Yan, Western security].

[三燕，西安].

(spoken in foreign language)

（用外語說）

We please allow me to translate my question. The first question is about the K A customer revenue. We observed that the KA customer revenue has achieved an incredible growth. We want to know what's the reason behind the high growth? And what's the gross margin of this business? And what's the net margin contribution to our future business? This is the first one.

請容許我翻譯我的問題。第一個問題是關於K A客戶的收入。我們觀察到KA客戶收入取得了令人難以置信的成長。我們想知道高成長背後的原因是什麼？這項業務的毛利率是多少？對我們未來業務的淨利貢獻是多少？這是第一個。

And the second one is about the cloud warehousing. We observed that the -- our logistic parks developed quite quickly. And we want to know the future development plan of our logistics parks?

第二個是關於雲倉儲。我們觀察到，我們的物流園區發展得相當快。我們想了解一下我們物流園區未來的發展計畫？

(spoken in foreign language)

（用外語說）

First of all, there are some statistics in a third quarter, the volume of K A businesses was 300 million and accounting for approximately 3.5% of our total parcel volume. KA revenue was approximately RMB1.3 billion, a year-on-year increase of 120%. KA revenue per parcel was RMB4.3, year-on-year increased about 31%, mainly due to an increase in the proportion of platform reversal reverse logistic customers with higher prices.

首先有一個統計，第三季度，KA業務量為3億件，占我們總包裹量的3.5%左右。 KA收入約人民幣13億元，較去年成長120%。每件KA收入為人民幣4.3元，年增約31%，主要是因為平台逆向物流客戶價格較高的比例增加。

In the third quarter, platform reverse logistics parcels handled by ZTO is approximately 112 million, a quarter-on-quarter growth of 25%. The unit revenue was RMB6.5, a quarter-to-quarter contributing about CNY1.5 per parcel to head a quarters profit. The main clients come from various e-commerce platforms, as we mentioned earlier, as ZTO continued to improve its quality of services, reduce losses, reduce customer complaints.

第三季度，中通處理的平台逆向物流包裹約1.12億件，較上季成長25%。單位收入為人民幣 6.5 元，季報每宗貢獻約 1.5 元，帶動季度利潤。主要客戶來自各個電商平台，正如我們前面提到的，中通不斷提高服務質量，減少損失，減少客戶投訴。

The platforms are choosing more and more so based on its efficiency and effectiveness formulation so that as we improve our services with the same price, we are able to win more platforms volume. And with the same quality of services, our price has more advantage built in.

平台越來越多地選擇基於其效率和效果的配方，以便當我們以相同的價格改進我們的服務時，我們能夠贏得更多的平台量。並且在同等服務品質的情況下，我們的價格更有優勢。

So as we focus on improving our own capability, we are expecting to continue to increase the retail volume, which, again, will help our network partners as well as our couriers to improve their quality of earnings. And in turn, as they improve their revenue and income, the entire core business will be supported as well going forward.

因此，在我們專注於提高自身能力的同時，我們預計零售量將繼續增加，這將再次幫助我們的網路合作夥伴以及快遞公司提高他們的獲利品質。反過來，隨著他們的收入和收入的提高，整個核心業務也將得到支持。

Now going on the infrastructure installed base. As we have about 95% of our sortation centers, most of them located in the centralized area, either for logistics or for businesses, the capacity to serve our entire ecosystem is more advantaged because we are able to share resources, have synergies in utilizing the same investment and produce continuous and repeated output.

現在開始基礎設施安裝基礎。由於我們大約有 95% 的分類中心，其中大多數位於集中區域，無論是用於物流還是用於商業，服務我們整個生態系統的能力更具優勢，因為我們能夠共享資源，在利用相同的投入，產生連續、重複的產出。

There are many locations where we have storage and sortation and ship out all co-located, which is what we have introduced before. It's called zero distance ship out or shipment, which, not only reduces the cost, but also improves the timeliness because we are able to take order all the way to 10:00 AM, at 10:00 PM and have that order shipped out during the same day.

有很多地方我們都有倉儲和分類，而且都集中出貨，這就是我們之前介紹過的。這被稱為零距離發貨或裝運，這不僅降低了成本，而且提高了時效性，因為我們能夠一直接受訂單到上午 10:00、晚上 10:00，並在期間發貨。

Our strategy in developing the total ecosystem to have more comprehensive logistics service capability is in line with our total mission to become the leader in the comprehensive logistics industry. So we will continue to improve, continue to implement this co-locating model and driving greater synergy across the entire logistics services arena.

我們發展全生態系統、增強綜合物流服務能力的策略符合我們成為綜合物流產業領跑者的總使命。因此，我們將持續改進、持續實施這種同地辦公模式，並在整個物流服務領域推動更大的綜效。

Thank you for your question.

謝謝你的提問。

This is our question and answer session. I would like to turn the conference back over for closing remarks.

這是我們的問答環節。我想將會議轉回進行閉幕式。

And thank you again for everyone to join today's call. I, I think it's worth mentioning that we are refocusing our resource and allocations. Our goal is to achieve great balance and a healthy balance of profit and burden sharing across the center in quarter network partners and also our couriers. We've been doing well in the past in fair allocation and equitable allocation of cost and income and profit among all constituents of our businesses.

再次感謝大家參加今天的電話會議。我認為值得一提的是，我們正在重新調整我們的資源和分配。我們的目標是在季度網路合作夥伴以及我們的快遞員之間實現利潤和負擔分擔的良好平衡。過去，我們在成本、收入和利潤在所有業務組成部分之間的公平分配和公平分配方面做得很好。

Going into 2025, our goal is to regain our volume growth momentum in order to resume the expansion of our volume leadership.

進入 2025 年，我們的目標是重拾銷售成長勢頭，以恢復銷售領先地位的擴大。

And at the same time, we are putting in place effective initiatives so that we will maintain our operating profitability as well as helping our network partners to improve their efficiency in managing their businesses and improving their profitability so that our network will continue to be healthy and sustainable for the future growth of the entire industry and in light with the recovery of the economy of China.

同時，我們正在採取有效的舉措，以保持我們的營運獲利能力，並幫助我們的網路合作夥伴提高他們的業務管理效率和獲利能力，使我們的網路持續健康發展。的復甦是可持續的。

Thank you again for your time and we look forward to discuss with you in greater detail.

再次感謝您的寶貴時間，我們期待與您進行更詳細的討論。

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.

會議現已結束。感謝您參加今天的演講。您現在可以斷開連線。